China’s 10-year government bond yield hovered around 1.68% for a third consecutive session on Thursday, as the latest industrial profit data highlighted ongoing economic softness. Industrial profits increased 17.6% year-on-year to CNY 4.58 trillion in the first seven months of 2026, slowing from an 18.7% rise in the January–June period. The moderation underscored growing pressure on corporate profitability amid weak domestic demand and the diminishing tailwind from earlier oil price gains.
The data reinforced worries about China’s growth prospects after July figures for industrial production, retail sales, and fixed-asset investment all came in below expectations. Earlier this week, the People’s Bank of China left its benchmark lending rates at record lows, keeping the one-year Loan Prime Rate (LPR) at 3.0% and the five-year LPR at 3.5%, signaling a continued cautious policy stance. Investors are now focused on the National People’s Congress Standing Committee meeting, which concludes on August 28, for potential new measures to shore up economic growth.
